Will online giant Amazon move in on Britain's wine business?

Amazon has rarely put a foot wrong. From its humble beginnings selling books from a California garage, Amazon expanded and diversified into other sectors, from music to toys and games, clothes, garden furniture and of course, the Kindle ebook reader and total sales of £30 billion.

But one area where it has so far failed to make an impression is in the potentially lucrative world of wine retailing. Until now.

Plans to sell a range of 1,000 wines in 12 American states have raised expectations that the group will make similar moves in Britain and go head to head with wine merchants and the supermarkets.

Uncorked: Amazon is expected to increase its wine sales in the UK

Amazon does sell some alcohol in the
UK as part of its grocery division, which is still being trialled, and
says it is ‘still early days’.

But
it has hinted it is planning to expand its online wine offering. A
spokesman told Financial Mail: ‘We don’t want to get drawn into
speculation about what we might be doing in the future. We are always
looking to expand our offering across all our divisions.’

Other
wine retailers agree Amazon’s wine operation is ‘very low key’ with one
saying ‘it launched very quietly and just hasn’t made its mark.’ But
they said they would be affected if it decided to push strongly in the
sector.

The overall online wine business grew 20 per cent last year and industry insiders believe this is the spur for Amazon.

Supermarkets
remain the leaders in the field, with an 83 per cent share of the wine
market, but specialists such as Majestic Wines and Laithwaites continue
to thrive and online companies such as nakedwines.com are making their
mark.

NakedWines has 100,000 customers and recently launched in the US and Australia.

Founder
Rowan Gormley said Amazon fell short because ‘you can’t just parcel
wine up and send it out like a book. People don’t start with a specific
product in mind with wine, so it’s hard to find what you want just by
looking at labels.’